Sunday, January 21, 2007

Look what you've done

BANGKOK, Jan 22 (Reuters) - Thailand's ITV PCL said on Monday it had agreed to pay 2.21 billion baht of the nearly 100 billion baht ($2.84 billion) fine the government has imposed for breach of contract.

The broadcaster, owned indirectly by Singapore state investment firm Temasek Holdings [TEM.UL], said in a statement it was still negotiating the final size of the fine with the government.

But ITV, which runs Thailand's third most popular television channel, said after a board meeting it was considering several options to raise funds to pay an additional sum.

ITV risks losing the right to operate if it failed to agree a final fine and payment timetable with the Prime Minister's Office, the department which owns the concession licensed to the broadcaster.

"If ITV and PMO could not negotiate on the issue and ITV was unable to pay the PMO within a specified time, the government agency has the right to terminate the contract," the statement said.

The company had planned to seek loans and raise money in a rights issue, but was unable to do so because of the uncertainty about the amount of the fine, ITV said.

In December, ITV lost its final appeal in the licence fee dispute with the PMO, which imposed a 97.7 billion baht fines for breach of its licence fee agreement.

ITV had appealed after a lower court ruled in May 2006 in favour of the PMO, which had sued the broadcaster to overrule an arbitration ruling which cut the company's fee payments to 6.5 percent of revenues from 44 percent in the original contract.

ITV is 53 percent owned by Shin Corp , for which Temasek paid $3.8 billion a year ago after buying the controlling stake of the family of ousted Prime Minister Thaksin Shinawatra.

ITV shares, valued at $39 million on the Thai bourse, were down nearly one percent at 1.10 baht at the midday break, when the overall Thai stock market was down 0.24 percent. ($1=35.16 Baht)

I was listening to this song and realised it was rather appropriate to dedicate it to Temasek and gang....